CFA Society Singapore
SINGAPORE (Nov 1): The manager of Ascott Residence Trust (Ascott REIT) has reported 3Q18 distribution per unit (DPU) of 1.82 cents, rising 8% from 1.69 cents in 3Q17 on higher revenue.
Revenue for the quarter grew 6% to $134.5 million from a year ago, mainly underpinned by additional revenue from Ascott Orchard Singapore and DoubleTree by Hilton Hotel New York – Times Square South that were acquired in 2017, as well as higher revenue from existing properties.
Gross profit grew 9% to $64.15 million from $58.75 million a year ago, largely comprising contributions from serviced residences on management contracts, followed by serviced residences on master leases and lastly, serviced residences on management contracts with minimum guaranteed income.
As a result, unitholders’ distribution grew 8% to $39.4 million.
Revenue per available unit (RevPAU) rose 8% on-year to $158, riding on higher demand for Ascott REIT properties in key markets including Singapore, China and Japan.
Commenting on the REIT’s healthy gearing of 36.4% and well-spread debt maturity over the long term, Beh Siew Kim, CEO of the manager, says she does not expect Ascott REIT to see any significant impact from the rising interest rate environment.
“We will continue to monitor and manage our interest rate and exchange rate exposure,” says Beh.
“Our refurbished properties have been able to command higher valuation and average daily rates of about 10% to 20% while enhancing the experience for guests. We have recently completed the renovation of Ascott Makati and Sheraton Tribeca New York Hotel. Guests can look forward to the newly renovated Citadines Trocadéro Paris and Somerset Grand Hanoi by end of this year and Somerset Grand Citra Jakarta in 1Q19,” she adds.
Units in Ascott REIT closed flat at $1.05 on Wednesday.